Organizational Design Change.
Your Change Program Can Bring Home the GoldWe don’t think an organizational change project can touch the level of enjoyment we get from a vacation or watching the Olympics. But could we at least try?
Why do we love the Olympics?
Have you ever thought about it? What if we told you we could break it down and help you make your next change project feel a little bit more fun?
It all starts with behavioral research. In “The Best Vacation Ever,” Drake Bennett looks at the psychology behind the definitive fun activity – a vacation – to explain the four factors that make something enjoyable.
- Anticipation: We enjoy looking forward to an experience more than actually experiencing it.
- Intensity: We remember intense highs, intense lows, and novelty – how our experiences “Peak” and “End.”
- Adaptation: We quickly acclimate to our current experience. If our positive experience is interrupted by reality, we have heightened enjoyment when we return.
- Deadlines: We tend to procrastinate on activities, even fun ones, if they have extended timeframes. We have more fun if it’s on a schedule.
Per Bennett, “….how long we take off probably counts for less than we think, and in the aggregate, taking more short trips leaves us happier than taking a few long ones. We’re often happier planning a trip than actually taking it. And interrupting a vacation – far from being a nuisance – can make us enjoy it more. How a trip ends matters more than how it begins, who you’re with matters as much as where you go, and if you want to remember a vacation vividly, do something during it that you’ve never done before. And though it may feel unnecessary, it’s important to force yourself to actually take the time off in the first place – people, it turns out, are as prone to procrastinate when it comes to pleasurable things like vacations as unpleasant ones like paperwork and visits to the dentist.”
It turns out that the Olympics are a great proof of these principles.
- Anticipation? How long does NBC, the US home of the games, spend hyping the Olympics? We get months and months of previews on NBC’s outlets, and disseminated across social media. By the opening ceremonies, we know what new sports will be included, who’s expected to medal, and what the US team uniforms look like.
- Intensity? “The thrill of victory, and the agony of defeat.” (Are we dating ourselves?) The games are jam-packed with highs and lows, and the coverage really exploits them. Simone Biles is out, and we all feel it. Lydia Jacoby’s gold has her entire Alaska town jumping up and down. We’re on a rollercoaster for weeks.
- Adaptation? Yes, the Olympics are interrupted by reality, especially for those of us watching from home. We end each normal day living vicariously through the glories and disappointments of the athletes.
- Deadlines? They come with the schedule. If Americans want to watch Tokyo events live, and remain unspoiled, they’d better get up in the wee hours of the morning.
Now, we don’t think an organizational change project can touch the level of enjoyment we get from a vacation or watching the Olympics. But could we at least try?
Could we nudge it in the direction of fun?
What if, as we design a change program, we incorporate these principles? Ask yourself these questions:
- How have we heightened anticipation for this program? What will be enjoyable or satisfying about it? How can we help people look forward to the good parts?
- Can we celebrate milestones and highlight better-than-expected performance? How can we end with a bang?
- Is the program broken into sprints? Can we build in periods of focus, hard work, and celebration, alternating with periods of business as usual?
- Do we incorporate tight timelines for action? Does everyone see the big-picture schedule and understand the urgency and the benefits of reaching the end?
It might feel like a stretch to try to create fun in the midst of an organizational change project. But just look at the impossible feats on your TV right now. You can do it!
Four Ways to Get the Traction Your Org Change NeedsYou need action, but employees aren’t listening. Here’s how to cut through the noise and get the results you need.
You are up to your eyeballs in change. The US pandemic is waning, but markets are still recovering, workforces are shifting, and the imperative of new technology hasn’t let up.
But you’re on top of it. You are clear on the initiatives your organization needs. Now you’re trying to manage a suite of overlapping rollouts, so you need a strong communication plan to get employees on board.
Your senior execs have delivered PowerPoint presentations, participated in talking head videos and sent sponsorship emails. You have a network of people to answer questions and send you feedback. You’ve branded the projects, distributed swag, launched apps…
But you’re not getting the traction you hoped for. People seem unaware of the key points, or just plain unaware. Execs are frustrated; they say, “We told them. Why aren’t they getting it?” Employees are not using the new tools and approaches you’re trying to deploy. Why not?
According to the Radicati Group, 281 billion emails are sent worldwide daily. With 3.8 billion users, that’s 74 emails per person. Every day. Bain Consultants estimated in a 2014 Harvard Business Review article that 15% of company time is spent in meetings. Verizon commissioned a study that found people attend over 60 meetings per month, accounting for 37% of their time. The WSJ found that we are distracted every 3 minutes.
So what’s going on?
Your employees are being assaulted by information and demands on their time.
You are not in the communication business, you are in the ATTENTION business. You have to help people cut through the noise and focus on what’s important. To do that, you have to rise above the fray. Everything you deploy should grab attention. Your messages must be obviously different, relevant and worthy of people’s limited time.
Here’s how to focus attention:
1. Keep it simple.
Distill your point to its essence. It’s your three-word theme for the year, the mantra that gets you to the project end, the political platform statement, or the four words that capture the problem, solution, approach and results.
A childcare company was implementing new technology. Here’s how they distilled it to four words. “Our caregivers are overwhelmed. The solution? Make sure they are connected. They deserve a thoughtful approach to this implementation. What do we want in the end? Energized people.” These words were easy to remember without relying on PowerPoint. Anyone from any department could provide examples for those words, and they did. Simplicity creates clarity.
2. Use visuals.
Researchers have found that people can remember 2,000 pictures with 90% accuracy, likely because visuals engage more of the brain. It doesn’t matter whether a person is trying to memorize the images or is casually exposed to them. There’s an extra, unconscious leap needed to translate an image to a word, which is why words are harder to remember. Line drawings are particularly easy to recall, perhaps because they are more visually complex. Crude hand drawings are more memorable than stock images. Dan Roam has a great book, Draw to Win, which can help you overcome your self-consciousness and create your own powerful visuals.
When he ran Farmhouse Rice Company, Peter Molloy created a “visual vision” to convey company direction. It was so effective, he used the same technique again when he became CEO of La Terra Fina.
3. Use novelty or contrast.
Subconsciously, we are constantly looking for threat. That’s why anything unusual piques our interest. When you create disruption — whether in stories, process, color, structure, volume – makes people notice.
Years ago, an IT department in a Chicago hospital implemented a standard approach to requesting support and custom reports. People were accustomed to paging their favorite IT person to fulfill the request. (Yes, it was that long ago!) When they moved to the new process, they changed all IT pager numbers. A small disruption signaled a new way of working. Look for variety and surprising ways to make your point.
4. Use environmental cues.
Look for elements in the workplace itself that can serve your purpose, like the physical space, processes, screens, codes, reporting relationships, and job titles. The real world encodes the conceptual. And often what people encounter every day contradicts what the company is telling them.
Chevron did it right. Years ago, they decided to create a culture of safety. That meant asking introverted engineers to be a little confrontational if they saw something unsafe. All the communication in the world wouldn’t address that behavior. So they made a point of starting every meeting with a “Safety Moment,” where each person had to identify one thing they saw that day that was unsafe. Over time, they layered it with other activities, such as assessing each person’s work station to ensure it was ergonomic, or confronting one another for driving while talking on their cell phone. These environmental cues reinforced behavior in ways no email campaign could.
Traditional communication plans fail because they don’t use the best thinking on human behavior. Don’t churn out information and hope it sticks. Focus attention on the behaviors you want and you’ll achieve your business outcomes.
Refreshing Leadership Meetings in 2021Meetings have such a bad reputation, especially among busy executives. But if you do it right, they’ll accept your next invite with a smile.
Facilitate the hell out of your next executive session
Leave them wanting more. Is that even possible with a meeting? People want fewer meetings, right? Or maybe you’re doing it wrong.
2021 is the perfect opportunity for a reset. Next time you facilitate an executive meeting, make it a satisfying experience: effective, focused, respectful, and even fun.
- Do your research. Nothing takes the wind out of your sails like the participants realizing you don’t know enough to run the meeting. Don’t make them stop and educate you. Make sure you’re rock-solid on the facts, figures, and history you need.
That starts with the Why. After you think you’re clear on the goals of the session, ask the participants. Send each one a personal invitation and ask them to answer one question:
“Why do you think we need this meeting?”
This will surface misunderstandings so you can resolve them before everyone shows up. It also gives each attendee some buy in – it’s a trick of psychology; you’re getting them on the record saying it’s important.
- Focus. We all know “Begin with the end in mind,” and that’s right. Start the session by confirming the goal. Here are a few more tips:
Limit attendees. In The Surprising Science of Meetings, Steven Rogelberg says the ideal size is seven participants. AND that decision-making effectiveness decreases 10% with each additional attendee! Balance your need to have all the right decision-makers in the room with the value of your outcomes.
Limit devices. I once sat in an exec meeting next to a new team member who kept his laptop open. I was the only one who could see that he wasn’t taking notes; he was reading the news, checking stock performance, and watching hockey highlights on mute. (I swear.) He didn’t last long in the company. Either the meeting is important or it’s not. If it’s not, then cancel it. If it is, then silence phones and close the laptops. If someone gets a call and has to take it, stop the meeting for a break. This has the double-whammy of respecting the call-taker (because you can’t continue without her) and pressuring her to get off the phone fast.
Use a “parking lot.” When someone goes off topic, stop, reset, and document that point on a flipchart page, whiteboard, or notes window. Promise not to lose that thread and follow up after the meeting.
- Limit session time. “I don’t need time. I need a deadline.” ~ Edward Kennedy Ellington. Duke was right— time limits work. Rogelberg and others recommend scheduling hour-long meetings for 50 minutes. If you truly need more time, break it into 50-minute sessions with specific milestone goals for each. And chunking up your process lets you use another technique…
- Delay decisions. Why do we say “I want to sleep on it?” Because it works. Time for reflection and synthesis yields better ideas. We’ve all sent that follow-up email saying, “Hey, I just had another idea” or “We didn’t have time to cover this, but…”
So design that into your session. Up front, explain that you will make no firm decisions at the end of any one meeting. Everyone will go away, let their “back burner” brilliance work, and come back together to confirm. This works well if you have broken your process into multiple short sessions. Assign a milestone goal for Session One, then use the first ten minutes of Session Two to play back tentative decisions, bring in new info, and make a final call.
- One up, one down. This concept comes from the military, but I know it as a best practice in my kids’ Montessori preschool. Each class had two teachers managing 25 kids working independently or in small groups. Rather than the goat rodeo you might expect, the classroom worked beautifully. “One up, one down” meant that when one teacher was focused on teaching students (in a chair or on the floor) the other should be standing, with a view of the whole group.
In an exec session, there should be at least one person focused on documenting, fixing, or providing support; the other should have eyes on the room, to manage the discussion and progress.
- Document, document, document. Executives have zero time for your shenanigans. They don’t want to repeat themselves, argue about what was said last time, or struggle to understand what’s going on. So make sure you collect and replay all essential information.
Record faithfully. If it’s ok with participants, record the audio and/or video of your meeting. That’s the only fool-proof way to make sure you know what happened. If you can’t do that, take copious notes. And commit to being the historian, calling up meeting minutes, inputs, and outputs in real time when asked. Use these to produce executive summaries at milestones and at the end of the process.
Dampen the politics. Sometimes it matters who’s talking. Junior participants might not hold the floor as long, or might get a quick rebuttal. But when you record and play back what happened, you can give all good content equal weight, removing any hierarchical barriers to a good idea.
- All brains matter. People process and retain information differently, so provide as many channels as you can. We default to bullet points and flow charts, with a voice-over from the facilitator. But that’s not the only way. Consider these:
Silent reading. Give the group information to read as an input to your discussion. Some people think better when eyes aren’t on them and people aren’t speaking.
Listening. The growth of podcasts and video books has revealed a segment of people who love to learn with their ears, minus other distractions. Use audio content in the session or as pre-work.
Video. Moving pictures really work for some people, especially with retention. Video has it all: sound, images, and verbal content.
Graphic documentation. This is a powerful way to capture ideas and decisions. Use a graphic artist to illustrate content in real time; you’ll end up with a graphic that conveys more than a list of bullet points ever could. Graphic documentation is a great touchstone to use after the meeting—post your graphic in a space where people can revisit it and use it to communicate to a wider audience.
- Be tenacious. Even the best outputs can evaporate after you all leave the room. People ignore emails, crises emerge, and enthusiasm fades over time. Don’t let go. Set milestones for feedback, new meetings, and other next steps. Get commitment before you leave the room. If necessary, unblock the logjams with one-on-one conversations over time.
- Lighten up. Why so serious? We can accomplish real work and have fun at the same time. We recently asked an exec team to come up with their own theme songs. Each member chose their own song, then they composed a song to represent themselves as a team, real-time. We captured and produced their work of art after the session. It was a good time, but it wasn’t just a good time—it surfaced and confirmed their strengths and cohesion. Think about how to brighten up your session. Use stunning graphics, gamify your process, or use a new environment for the meeting. Fun doesn’t have to get in the way—bake it into the work.
Meetings have such a bad reputation, especially among busy executives. But if you do it right, they’ll accept your next invite with a smile.
Scaling Your Workforce in Tough TimesIf you need to scale quickly, we have some ideas for you to consider.
We all know the bad news. The US economy lost 20.5 million jobs in April 2020, according to the Bureau of Labor Statistics—by far the most sudden and largest decline since the government began tracking the data in 1939. The unemployment rate soared to 14.7% in April, its highest level since the BLS started recording the monthly rate in 1948. The last time American joblessness was that severe was the Great Depression.
But it’s not all bad news. Certain businesses associated with logistics and supply of critical goods are actually hiring…like crazy. Instacart is hiring 300,000 contract workers. Amazon is bringing on 175,000 new workers for its fulfillment centers and delivery network. We see additions of 50,000 each for CVS Health, Dollar General, and Walmart. Lowe’s is hiring 30,000 employees. FedEx is hiring. Ace Hardware is hiring.
A company like Amazon is used to scaling up for seasonal hiring but many businesses are not. Hiring thousands so quickly taxes the organization’s entire talent management system.
At Emerson, we think of talent management holistically; it supports the organization’s culture and helps achieve desired business outcomes.
When you need to scale quickly, here are some ideas to consider:
Standard career fairs and job postings won’t work right now. What are the best ways to acquire talent? How can you quickly identify the best when supply exceeds demand due to high unemployment?
- Tap into communities like church groups, food banks, university campus online boards.
- Work with other companies that have laid off or furloughed workers.
- Apply AI technology to filter best applicants.
- While it may be tempting, don’t hire the first warm bodies. Maintain your recruiting rigor with a focus on the critical skills for the job as well as cultural fit. In some markets and industries, it’s a buyer’s market, so leverage it and don’t settle.
Measured, multi-week onboarding doesn’t cut it when hiring thousands at one time. How can you streamline the process?
Use a “speed dating” model. Allow groups of applicants for similar jobs to familiarize themselves with the end-to-end process in a few hours by moving quickly through the main steps or stations. Then, assign a given cohort to specific coaches for more detailed on-the-job training.
- Show short videos rather than live demos or blend videos with live learning. Note that videos don’t have to be professionally done to convey key points. Think TikTok, not Ken Burns. Use a tripod and your iPhone.
- Update your critical job aids. Simplify them to highlight the common, critical, and catastrophic–the “must-knows and dos” for the job. Think about how employees will use the job aids. Should they be laminated or posted? Should they only be online? Ensure they are multi-lingual if needed.
- Make it easy to spot coaches or team leads through clothing, like a colored cap or vest or a large badge. Post visible “Ask Me” signs on the tops of the coaches’ workspaces.
- Appoint a buddy to each new hire for a quick-and-dirty mentoring program.
Engagement and Retention
Turnover is costly. For workers earning $30,000 or less, the typical cost of turnover is 16% of annual salary, or $4,800. For workers earning less than $50,000 annually, average cost of replacement is 20% of annual salary, or $10,000. Five to ten thoursand for each entry level job? Multiply that by a thousand and you can see how turnover can hurt.
Unemployment is high so getting a replacement worker is easy, right? No! Every turnover requires replacement costs like recruiting, physical or drug testing, background verification, and training.
Putting a little effort into retaining those you hire will save you a lot of money.
- Make your work environment positive, comfortable, and safe!
- Focus on respect for employees. Provide supervisors with tangible examples of what “showing respect” looks like.
- Offer appreciation with unexpected small perks like periodic snacks–maybe a weekly delivery of fresh fruit or some other food your employees would enjoy.
- Recognize employees during staff meetings. Make it more personal; for example, ask leaders to send handwritten notes to employees’ homes.
Development and Performance Management
Yeah, we know what you’re thinking: hire now and worry about development later. But it’s never too early to think about how you’re going to evaluate, develop, and retain that new hire. You’ve just placed someone in an entry level job; what are the criteria to determine she’s ready to be a supervisor a month from now? How can you use development to avoid turnover?
- For job positions with the biggest hiring need, develop some simple evaluation criteria. Anticipate and document how you’ll close performance gaps and how you’ll promote those who are excelling across the board.
- Hiring is harder than firing, so be thoughtful about termination. For the harder-to-fill positions, how deep are the employee’s deficits? What is the return on investment for developing that person instead? How much effort can you afford to spend in developing a poor or mediocre performer?
By the way, be on constant lookout for new hires you want to retain and/or cross-train after your demand surge subsides.
Impact on Culture
Every employee contributes to the culture, including the new hires. When you’re hiring thousands of people at one time, they have the potential to impact the existing culture. That’s not necessarily a bad thing, but no company wants to change their company culture unwittingly.
- Set the stage by showing a video on the company culture, purpose, vision, and values during onboarding.
- Enlist high-profile company leaders to visit facilities and personally welcome some of your new hires. A high touch “hello and welcome” is more meaningful than a big, impersonal all-hands. The new hires who speak to the leader(s) will tell other new hires of the gesture and that’ll strengthen engagement and loyalty.
- If the new hires are located together, physical reminders like posters and company gear such as caps or tee-shirts can reinforce the company culture.
- Invest more time with the coaches, team leaders/supervisors, to ensure they role-model the culture. They are the closest to new hires and their impact is huge.
- Identify a few key behaviors that are imperative to maintaining your culture/values and bake those into performance evaluations. Then act quickly to address those who are counter-cultural.
It’s daunting to hire thousands in a matter of months. Hiring the right people in the right numbers will answer your business demands and yield the outcomes you want, including revenue, profitability, and brand reputation. Invest a little to do it right.
Scale fast but scale smart.
Are you uncomfortable? Good. The work is just startingYou want to be on the right side of this sea-change and tap into the culture of tomorrow. But to do this right, you will have to unlearn some of the behaviors that got you this far.
Getting the Inclusive Culture You Need
No organization remains untouched by these times. The pandemic, the sweeping protests for justice, and 2020’s political tipping point affect every person, every community, and every business. We must respond or be responsible.
You want to lead your organization through this and emerge stronger. You want to be on the right side of this sea-change and tap into the culture of tomorrow. Being one of the thrivers will mean you can attract the talent and customers you need in the future. So you’ll apply all your leadership talents to this challenge, just like all the other challenges you’ve faced.
Wrong. Here’s the first hard truth: To do this right, you will have to UNLEARN some of the behaviors that got you this far.
Act. Don’t wait until you have the perfect plan. Nature abhors a vacuum, and so do employees. They will fill in an empty space. If you say and do nothing, or wait too long to plan a response, they will assume you agree with the status quo or don’t care. And by the way, saying, “We are going to do something – stay tuned” is doing something. Just don’t do NOTHING.
Listen. Don’t say your organization celebrates diversity. Ask, “Does our organization celebrate diversity?” Don’t say you are putting health and safety first. Ask, “Are we putting health and safety first?” You might have departments and task forces and employee surveys on this stuff. So what — assume you have a problem and find out what it is.
And this is critical: Make it safe for employees to answer the questions and ask their own. If they think there will be consequences for making their bosses uncomfortable, you will hear nothing, learn nothing, and accomplish nothing. So say it, straight up: “No one will be fired or demoted for speaking up.” Also, give people several channels of communication – live and face-to-face, by anonymous forum, by survey, and via small groups or task forces. Capture what you’re hearing, synthesize it, and then distribute it for feedback. Say, “This is what we’re hearing. Are we getting it right?” Then listen again. It’s a cycle, not a task to be checked off.
Tap into the positives of a grass-roots change.
Wanting to be heard is innate. Forming community is natural. Think about protests and social movements – people march to be seen and heard, and they work on causes to create change together and feel like a part of something big. Simply put, these things activate feel-good chemicals in our brains. Do this for your business, and your employees will feel good about your culture. You will create unity around your organization, your brand, and your mission.
Disrupt. Changing culture is like changing the course of a river. You have to really want it, because it takes dynamite. It’s messy and confusing while it’s happening.
But the ugliness of the disruption is good – it’s a signal to all that you mean business. This is not just about memos and posters and procedures – they’ve seen all of that. This has to look like nothing they’ve seen before. It’s Opposite Day. How do you usually talk to everyone? What words do you use? Where do you meet? How does it feel? Don’t do any of that. Say or do things they don’t expect to set the right tone.
Then use that dynamite. When you hear what’s wrong, go after it. That looks different for every problem and every organization. Use your sounding board to guide you.
Facilitate. As you figure out significant actions to take, let people step up and lead, based on their skills and passions. And then follow; ask what you can do to advise, clear a path, and make things happen. And then lead by example. Show employees you are taking concrete and personal steps toward the culture you are defining together.
Never stop. Don’t declare victory and disband the change team. Assume there is always more to do. Make the effort permanent. Keep listening and learning. Forever. You can celebrate, but celebrate progress, as defined by employees and experts. Celebrate growth, and then keep growing.
So here are your new leadership behaviors, for a new culture:
Familiar, Controlled, and SuccessfulAt Emerson, we like to take scientific findings and use them to help you get the business outcomes you want.
There is a lot of research on the brain and behavior. Science can tell us why we feel and act the way we do. At Emerson, we like to take scientific findings and use them to help you get the business outcomes you want. There are three principles, based in science, which can help you make any organizational change or learning program better. Science tells us that if we want to implement something new in an organization, we should make it feel Familiar, Controlled, and Successful.
The first principle is Familiar. Our brains see anything new as a threat. We feel fear. Familiarity can make a new thing feel safe and valuable. Familiarity is created by comparing the new thing to your past experiences. Compare the change to something good. Compare the change to something bad. Use what they already know. And, of course, we know stories are powerful. So you can use a story as the vehicle for each of these. I’ve used story telling on many of my projects. Typically, I find executives or well-respected managers to share stories that help make the change to feel familiar. Also, use repetition. Perhaps the information is new to people when you start the project, but if you keep repeating it over and over, it becomes familiar. I do this by having multiple resources sharing their stories.
The second principle is Controlled. Our brains don’t like uncertainty and they don’t like feeling vulnerable. Giving people predictability and control lowers anxiety and unleashes people’s potential to plan and organize. Control is created by giving a change predictability and structure, and by giving people choices. Share a schedule or project roadmap to help those impacted by the change to understand when things are happening. This helps them to schedule the rest of life which gives them some control during the change. Also, Frequently Asked Questions provide stakeholders with additional information which helps them to feel control.
The third principle is Successful. Brain research tells us exactly why winning feels good. And why winning together feels even better. A feeling of success is created by engineering small wins and celebrating milestones. One way to make someone feel successful doing something new is by breaking that new thing into small, simple tasks. Another way to make people feel successful is by making the new thing doable. Also, be sure to make your change measurable. Being able to measure it helps to show when goals are being achieved. Once those goals are achieved or those milestones are met, use rewards to encourage people to continue moving forward with the change. In past projects, I’ve set it up so that teams who are showing progress, get recognized by the company. This encourages them to continue moving forward and it helps the rest of the organization see how things should be done based on the new way of doing business.
Creating connections between your change and other experiences makes people feel it’s familiar, which turns off fear, makes the change feel valuable, and helps people remember it. Adding choice, structure, and predictability makes the change feel controlled, so people feel less anxious, more engaged, and get to use their brains’ executive functions. Engineering small wins; measuring; providing feedback and rewards; and celebrating make people feel successful, activating the feel-good chemicals in their brains. Use the simple strategies outlined here to make your change feel Familiar, Controlled, and Successful. In doing so, the change will be more quickly adapted in your organization.
Meet the Original Organizational DesignersOur Founding Fathers did more than write the Constitution. They paved the way for organizational designers.
I recently realized our Founding Fathers were among some of the first organizational designers. The comparison stuck out to me while I’ve been learning about Constitutional Law through an online class at Yale. Don’t believe me? Indulge me for a minute or two and I’ll explain.
An organization’s structure can either enable or block change. If you want to institutionalize change and make it sustainable and successful, then your organization’s structure must facilitate the behaviors you ultimately want.
Our Founding Fathers knew this, and that’s what led them to scrap the Articles of Confederation (America’s original org design) and start over by creating the Constitution (our current org design – with some tweaks).
A case study in organizational design
What I learned in class is the founders’ first attempt at org design, the Articles of Confederation, focused too much on the organization. It did not focus enough on design and how people work together to deliver value to the customer; a common error made in organizational design.
For example, in the Articles of Confederation, each state was supposed to support a federal army for defense. But, there were not any “levers” or processes created to compel states to send money or troops. The result was many states did not contribute their fair share in America’s revolution against Britain. This nearly caused America to lose the war for independence.
Luckily, the founders recognized the flaws of their original org design. So, they started over by creating the Constitution with a laser-like focus on the processes that would deliver value to the customer. “We the people”.
A new design
The founders first focused on the country’s three key processes: the legislative process (Article I – The Legislature), the executive process (Article II – The Executive), and the judicial process (Article III – The Judiciary). Only once they identified the key processes did they add in details within each article about specific job functions. They also included other articles to better define and clarify jobs and functions.
The Constitution, unlike the Articles of Confederation, now had “levers” or processes in place that re-enforced the behaviors and actions the founders wanted from each branch and the states.
See, I told you our Founding Fathers were some of the first organizational designers! Their org structure and design have lasted more than two hundred and twenty-five years, with a few org design tweaks or amendments along the way. That’s an impressive track record!
You can have the same success in creating your organization. Remember to focus on the processes and behaviors that deliver value to your customers. Define jobs after you have defined the processes; only then are you truly designing an organization that facilitates successful behavior and change. H
opefully, one that lasts as long as the original org designers created when creating our Constitution. Good Luck!
Design the Organization Your Customer WantsIf your company is facing big change it could be time to think about org design. Read this first.
Your company is about to experience big change. I know what you’re thinking: “What a great opportunity to improve your organization design! Should we stick with a functional structure or experiment with a matrix? Hmm…”
Well, maybe not. But maybe you should! A change is a great chance to examine your organization’s structure. If you’re thinking about a new model, consider reverse-engineering your design. Start with the customer’s perspective.
- What would your customers recommend? Do you know?
- What is your customer experience journey? Do you know where you deliver excitement, confidence, trust, or other kinds of value?
- What problems do your customers experience? How adept are your teams at solving them?
Chances are, you don’t have the answers to all of these questions. But if you like this approach to organization design, here are the steps I suggest:
- Map your customer journey, include emotional peaks and common problems (by frequency and type).
- Get the right talent, skills and knowledge to deliver delighters, and eliminate or solve problems. That means building new job descriptions and recruiting differently.
- Define the performance management system you need to drive the right behaviors.
- Create supporting business rules and processes.
- Empower your customer-facing work teams to meet customer needs and enable the outcomes they want.
- Follow the same steps to redesign your support functions. They must serve your customer-facing teams – their internal customers.
Organization design shouldn’t be about boxes on charts or what makes sense historically. Focus on what delivers value, and you’ll build the optimal structure.
The Retail Industry Is TransformingTwo things retailers must do now
First, the good news: retail sales picked up in December driven by improved demand at car dealers, Internet retailers, furniture stores and building materials outlets. But sales continued to decline at department stores, restaurants, and electronics/appliances merchants.
Retail is undergoing the biggest transformation in decades. Most department and specialty store operators announced terrible holiday sales and negative comps. As reported by CNBC, RetailNext found that, despite a spike at the end of the holiday season, sales and traffic fell in double digits for many brick and mortar retailers. But this isn’t a seasonal problem.
America is completely over-stored. According to Howard Davidowitz of Davidowitz and Associates we have three times the retail space per person of the United Kingdom, Japan or Canada. CoStar estimates that over one billion square feet of retail will be closed or converted in the coming years. Over $50 Billion in real estate debt on retail stores is coming due in the next eighteen months; this is in the context of a rising interest rate environment and low economic growth (no more than 3% of GDP).
Retail experts expect tens of thousands of stores to close in the coming years. These are some of the store closings announced just this month:
- Sears will close another 104 stores, laying off 4,000 employees. They have closed more than half their stores since 2011. Roughly 80% of remaining 714 leased Kmart Stores and half of the 386 remaining Sears stores will come for lease renewal in the next five years and will likely be shuttered.
- Macy’s is closing 68 stores, laying off 6,800.
- Limited (owned by Sun Capital Partners) is closing all of its 250 stores, and will probably liquidate merchandise online.
- Abercrombie & Fitch will likely close up to 50% of its remaining 745 leased stores over the next 18 months, as leases expire.
- American Eagle is expected to close 185 stores over the coming year, as leases expire.
Thousands of employees will lose their jobs in the ongoing shift from brick and mortar to online retail. Even Walmart, once expansionary, is now closing stores in favor of investments in online retailing. Walmart spent $3.3 Billion to buy Jet.com, a money-losing online retailer that is barely one year old. And why not – online retail represents only 10% of the retail market and is expected to climb to over 50% in the next fifteen years. Amazon just announced they will hire another 100,000 employees in the US over the next 18 months. Retail sales are systematically shifting online and the biggest beneficiary of that trend is Amazon and any retailer that gets ahead of the trend.
Retail companies need a proven, disciplined approach that delivers results.
So what does that mean? First, make hard decisions quickly. Uncertainty is the retail leader’s greatest enemy. It is more important than ever for retail companies to have a plan to steer through this tsunami of a marketplace.
To do this, leaders must be certain. Align the entire management team around a common vision and strategy, and do it with speed. Playing catch-up is not good enough, as many retailers have discovered the hard way.
Once you have a well-conceived plan and your leaders are aligned, create momentum. How do you create momentum across your entire company? There are two essentials.
- First, focus on your early adopters. Get them engaged and working toward the new way of doing business. Yes, you will need the entire company behind your changes, but don’t try to win every heart and mind at first. Ironically, you’ll move faster if you identify and deploy influential people, ate every level, who will adopt your change and get moving.
- Next, make the change feel familiar, controlled and successful to employees. They have to feel safe and confident of success, or you’ll get nowhere. Moreover, research shows we must create momentum within 90 days of launching a change – again, speed is of the essence.
So management needs more than a plan; they must engineer momentum by using the right people and launching the right activities. In a vacuum of direction, employees are uncertain and afraid; lack of certainty will make any initiative fizzle.
Strategize fast, align and get on-message, and create momentum. The whole marketplace is changing forever, but the swift and strong will survive.
Christian is Vice President, Consulting for Emerson Human Capital. Christian has led enterprise-wide transformational retail consulting projects for Gallup and Accenture and worked in global development for Walmart and Metro AG.
Organization Structure for Learning & DevelopmentThere is no one best model for a learning and development function, but there is a best model for your organization.
There is no one best model for a learning and development function, but there is a best model for your organization.
In any company, L&D interacts with other internal entities according to certain rules: who has decision-making authority, what the roles and responsibilities are, and who owns the money for training development and delivery. So what are those entities? It could be functions within a business – say, Supply Chain or Sales. For a global corporation, it might be geographic regions – North America, Europe, Asia/Pacific. In a consulting company, it might be major service offerings, like Audit, Tax, and Advisory. In a very large company, the components might be a matrix that crosses both regions and functions or offerings.
Whatever the components, your L&D organization falls somewhere on a continuum of authority and centralization. I’ll talk about the pros and cons of structures along this continuum.
The Centralized Model
How It Works
L&D planning and decision-making are driven centrally. Let’s say Jack Lerner is the head of the L&D function for a consumer products company. Jack has a training budget and a team to build a curriculum and courses for each of the functions. He and his team of direct reports are responsible for onboarding, compliance, and leadership programs that cross the functions.
Jack works with each business function to understand its training and development needs. He then looks across all the existing curricula to see whether there are materials or courses that could be leveraged. If Jack can’t find anything, he works with instructional designers – who might be part of his team or a separate service – to build courses the function needs.
Jack prioritizes course development according to the strategic needs of the overall business. For example, the Rental function might be new, and therefore have a heavier need for development than the very mature Manufacturing function.
Why Use This Model
Centralized models are efficient. Jack will have a good view of what is already in the curriculum and what the gaps are. This model reduces redundancy; without this model, each function tends to build its own courses though another function might already have it. A centralized model fosters standardization of content and processes. The model makes it easier to ensure that all training programs are aligned with the strategic objectives of the company rather than the sometimes conflicting needs of each area. Jack gets his budget from the company overall and usually has the authority of how to allocate funds.
If the other entities in the organization aren’t communicating well with Jack or if they don’t have a good understanding of learning and development issues or if they try to circumvent the centralized function and develop training on their own, they risk creating training that is disconnected from the goals of the business. If Jack’s team isn’t large enough and/or skilled enough, they can be too slow and too removed from the business to be useful in a fast-paced functional area.
The Decentralized Model
L&D planning and decision-making reside in the business components. Jack might have responsibility for programs that cross functional areas, such as onboarding and compliance. In smaller companies, these programs might be handled by HR with little or no dedicated L&D support. In either case, some cross-functional programs are typically still held centrally in the decentralized model. The rest of the learning professionals are deployed to the functions. Each reports to the function’s leadership and develop programs specifically for that function.
How It Works
Let’s say that Alicia is responsible for the Manufacturing function’s learning program. Each fiscal year, she and the VP of Manufacturing work on the training priorities and budget to train the professionals. Alicia then partners works with her team to develop the Manufacturing training program for the year. She is aware of the central training that is impacting the people in her group, but has very little visibility to the training is being built in any other business unit.
Why Use This Model
Decentralized models can be very effective and targeted for the business. There is less coordination, as Alicia has a clear reporting relationship only to the function she serves. With the Manufacturing team as her focus, she can respond quickly to every request. Her budget is allocated by Manufacturing, annually.
Because Alicia doesn’t know what the other functional leads are doing, she won’t realize that, for example, each of them is building a course on communications. That means wasted development dollars. Each function must also prepare facilitators to deliver the training. And, and in some areas, they might not have enough learners to make a full class. Alicia might not know there’s a new and innovative program Luis is building for his function, so she won’t take advantage of his best thinking. Finally, since Alicia’s L&D team is relatively small (it might just be Alicia, in fact), she is less likely to grow as an L&D professional.
Finally, in the middle of the continuum is the Balanced Model.
The Balanced Model
In this model, L&D planning and decision making are driven through a central function with significant partnership from the business. Jack has responsibility for the company’s cross-functional curriculum. The rest of the learning professionals or HR business partners are deployed to the functions. They are responsible for ensuring function-specific training is built. They own the functional requirements and the outcomes.
How It Works
This is the most matrixed model. All parties must coordinate, collaborate, and communicate for this model to work well. Jack probably owns curriculum that impacts all employees. This might include onboarding and compliance training as well as professional, leadership, and/or consulting skills. Jack also owns the company-wide training schedule, and the learning management system and other development and delivery technology.
The business partners or functional designees are responsible for understanding and representing the needs of the business and the functional and on-the-job skills that need to be built. Together, the crew works to balance priorities and build an effective and efficient curriculum.
Why Use This Model
When implemented well, a balanced model represents the best of both worlds. There is a deep understanding of the business married with standard processes, tools, and governance. This model is both effective and efficient, particularly when it works within a clear governance structure.
On paper, it seems like the Balanced model should be the nirvana of organization structures, but successful implementation is tricky. It requires all parties to communicate and collaborate in good faith – weighing the needs of each part of the business with the company overall. If Luis decides to create custom communications training for his function, even though there is a company-wide communications course, the model loses some of its value.
These three models are common examples of many possible variations. Organization structures are sometimes more fluid in practice than in design. Think about which L&D organization structure you have, whether it’s functioning as designed – to take advantage of the model – and whether it’s aligned with your company’s overall objectives.